Average cost of renting land increases

The average cost of renting agricultural land last year increased by 3%, according to statistics from the Scottish Government.

Figures in a report, Tenanted Agricultural Land in Scotland 2015, published yesterday reveal the average rent was £15.78 per acre, compared with £15.37 per acre the year before.

Scotland’s chief statistician said rent increases were seen in both the poorer quality Less Favoured Area (LFA) land and better quality land.

The average rent for LFA land was up 3% to £10.52 per acre, while the average rent for better quality land was up 5% to £52.61 an acre.

Government said: “Since most rents are reviewed only every three years, this implies that, where there have been increases, they have been, on average, well above 3%.

“Rent increases have been above inflation since 2008.”

The report estimated that around 23% of all agricultural land, 3.26 million acres, in Scotland was rented on a full tenancy or croft last year.

There was no data on the area of land let out on a seasonal basis, however the report said the amount let in 2014 represented around 13% of Scotland’s agricultural land mass.

The number of holdings with rented land was down to 16,691, from 16,760 previously.

Within this, the number of 1991 Act tenancies was down slightly to 4,904, from 4,993 previously.

The number of short-limited duration tenancies (SLDT) was up 13.3% to 945, from 834 previously, while the number of limited-duration tenancies (LDT) was up 5.5% to 557, from 528 previously.

The report said there was no clear link between profitability and whether a farm is entirely owned or entirely rented.

Rents were highest in Fife and the Lothians, with three quarters of tenants paying more than £30.35 an acre.

Both NFU Scotland (NFUS) and the Scottish Tenant Farmers’ Association (STFA) said they were shocked by the figures.

NFUS legal and technical policy manager Gemma Thomson said: “Given the huge pressure on farm businesses at this time, it is difficult to envisage any circumstances that would support an increase in rents.”

STFA chairman Christopher Nicholson agreed and said rent increases were against a backdrop of a 26% fall in farm business income figures to the lowest level since 2009.